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Credit Score Information: Guide to Credit Scores Research Team | Posted On Wednesday, January 09,2019, 02:16 PM

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Credit Score Information: Guide to Credit Scores



A credit score is a 3-digit summary of credit worthiness. It says how likely you are to repay debt. Is credit score all there is to get a loan? Credit score is an important factor to get loan sanctioned, but it’s not the only factor. Lenders look at your profile, years of service, educational background, dependents, assets, income and savings before sanctioning the loan.

What is a good credit score?

The credit score ranges from 300 to 900 with 300 being the lowest score and 900 the highest. A credit score of 750+ helps get loans sanctioned.

SEE ALSO: Eligibility Criteria For Credit Card

How credit history impacts credit score?

Missing the due date on your credit card or not paying EMIs in time is a strict No. This gives a bad credit score. Missing a single EMI impacts the credit score.

If your credit score is bad because you don’t pay credit card bills in time, start paying them in time. This brings a good credit score.  

A track record of timely payments (You pay EMIs and credit card bills on time), impacts credit score. Credit history is assigned a weightage of 35% in credit score.

Many people have this question? Does paying electricity bill or water bill late affect credit scores? Fortunately No…. It’s just the loans and credit card bills which must be paid in time.

Want to know more on Credit Score? We at will make it easy for you. Just give us a missed call on 022 6181 6111 to explore our unique Free Advisory Service. is not a seller of any financial products. We only provide FREE financial advice/education to ensure that you are not misguided while buying any kind of financial products.

SEE ALSO: Five Ways Your Credit Card Can Help You Save Money

Credit Score Information: Guide to Credit Scores

How to improve credit score?

  • Pay loan dues in time: The basics don’t change. Repay credit card dues, Home Loan EMIs, Personal Loan EMIs and other EMIs on time. Late EMI payments give you a poor credit score.
  • Maintain a healthy credit mix: This is a healthy mix of secured and unsecured loans. Secured loans are secured against collateral/assets. Home Loan, Car Loan, Two Wheeler Loan, Loan against Property (LAP) and Loan against Security (LAS) are secured loans. These loans charge lower interest compared to unsecured loans.

Unsecured loans like personal loan, credit cards have no collateral. Lenders charge a higher interest on these loans. This is why credit mix is very important. Credit mix refers to the type of accounts which make up your credit information report (CIR). If you have availed a number of unsecured loans, credit score goes down.

  • Check credit report and credit score: You need to check credit information report (CIR), to see if loans reflecting in your name, have really been availed. Data entry errors/typing errors could mean spelling mistakes with name or a loan which you have not availed, reflecting in your name. Your credit score goes down for no fault of yours. Check credit report and credit score for free at If there are any errors in credit information report, get them rectified and improve credit score.
  • Standing guarantor to a loan: Standing guarantor to a loan or co-signing a loan makes you equally liable for missed payments. Never stand guarantor for a loan unless you’re sure (Friend or Family Member), will make the repayments in time. On a default, the credit score goes down.
  • Apply for new credit within limits: Don’t just apply for loans and credit cards. Applying for multiple loans/credit cards tells banks you’re hungry for credit. The bank checks your credit information report and credit score called hard enquiry. This results in credit score dropping. You can check credit report and credit score any number of times called soft enquiry. Check free credit score and credit information report at
  • Get a secured credit card: Avail a secured credit card where fixed deposit is the collateral. You have to open an FD at the bank and apply for secured credit card. Banks offer credit limit on credit card up to 80% of the FD amount. As this is secured against FD, interest rates are lower than normal credit cards. Make timely repayments on secured credit card to build credit score.

SEE ALSO: How To Transfer Money From Credit Card To Bank Account?

Why do credit scores fluctuate?

Time: If there are no changes/updates in credit information report, this causes fluctuations in credit score. Missing a single EMI over a long period of repayments has not much effect on credit score. This doesn’t mean you must miss even a single repayment.

Payment history: This has a high weightage in credit score. Paying EMIs and credit card bills influences credit score as payment history is reported to credit information bureaus like TransUnion CIBIL, Equifax, Experian and Highmark.

Debt-to-credit ratio: This tells how much available credit you’re using. How does this influence credit score? If your credit card balance changes each month and the amount of available credit you are using changes, credit score fluctuates.

Can medical debt impact credit score?

No, unpaid medical bills does not impact credit score.

Does checking my Credit Score Hurt My Credit?

When you check your credit report and credit score, it’s a soft enquiry. This doesn’t hurt credit score. IndianMoney has tied-up with Experian to give free credit score. Check credit report and credit score FREE at

How to increase credit limit?

Credit cards fix credit limit based on earning potential, financial position and credit history. Credit limit is the maximum outstanding balance on credit card. Credit limit doesn’t remain same across life and you can enhance it as you earn more.

1. Use credit cards when travelling abroad

Credit card Companies charge an overseas currency markup which could go up to 3.5% for transactions overseas. This is prime income for credit card Companies. If you frequently travel abroad, credit card Companies enhance credit limit.

2. Apply for a new credit card

Just apply for a new credit card with higher limit. You could apply at the same lender or a new one. Banks check credit score before sanctioning the credit card.

3. Request credit limit hike

Increase credit limit by requesting a hike. The credit limit depends on current income and credit score.

4. Opt for secured credit card

Pledging a fixed deposit can increase credit limit. Axis Insta Easy Credit Cards, ICICI Instant Platinum Card, SBI Credit Cards, HDFC Credit Cards and IndusInd Credit Cards are some of the secured credit cards in India.

5. Use credit card regularly

Using credit card regularly with timely repayments sends a signal to banks that you’re a candidate for enhanced credit limits.

6. Submit salary increment slips

Earning potential increases credit limit. If you have got a salary hike, submit documents and enjoy a higher credit limit.

Does closing a Credit Card impact Credit Score?

If you have a credit card with a history of timely repayments over a long period, don’t close it. This helps build a good credit score. Closing a credit card is done only once all dues are paid. It has no impact on credit score.

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